People should die for this

[Sho'Nuff]

Many companies do not have their own payment processing center, and outsource electronic payment collection to a third party. For example, the little league chapter in my area has a web based system that allows parents to register their child for little league online. They have the option to pay the registration fee by check (with no convenience fee), or to pay the registration fee online for (with a processing fee of $2). That $2 is a negotiated amount between the little league chapter and a payment processing service with which the the little league chapter contracts to allow them to receive electronic payments.

So while the collection of electronic payments does not amount to more work for the little league, it does come at a cost to them. So they are left with the options of adding the fee internally to league registrations (unfair to those who pay by check), or adding the convenience fee to the electronic payments.

Put more simply - electronic payment collection is not free. Infrastructure is required that many companies do not have, so they contract with a third party who has the infrastructure to collect electronic payments on their behalf for a fee. That fee is an increased cost of doing business, which is passed on to customers.

 

[Raduque]

It's because they aren't allowed to charge you "credit card transaction" fees anymore. So they call it a "convenience fee" now.

 

[Scarpozzi]

My city water bill is like this too. Basically this is a classic example of a small office outsourcing their billing X years ago and not actually handling the transactions. That's being done by a 3rd party because the idiots in the office don't know how to do it internally.

 

[Jeff7]

It's because they aren't allowed to charge you "credit card transaction" fees anymore. So they call it a "convenience fee" now.

I was at a Weird Al concert.....looks like it was in 2003. Ticketmaster.
Convenience fee because I used the newfangled Internet to buy tickets.

But, I get the idea that Ticketmaster is in its own special class of being a dick to customers, sitting in the same room as Comcast.



(Dear god, 2003. That long ago already.)

 

[lupi]

Many companies do not have their own payment processing center, and outsource electronic payment collection to a third party. For example, the little league chapter in my area has a web based system that allows parents to register their child for little league online. They have the option to pay the registration fee by check (with no convenience fee), or to pay the registration fee online for (with a processing fee of $2). That $2 is a negotiated amount between the little league chapter and a payment processing service with which the the little league chapter contracts to allow them to receive electronic payments.

So while the collection of electronic payments does not amount to more work for the little league, it does come at a cost to them. So they are left with the options of adding the fee internally to league registrations (unfair to those who pay by check), or adding the convenience fee to the electronic payments.

Put more simply - electronic payment collection is not free. Infrastructure is required that many companies do not have, so they contract with a third party who has the infrastructure to collect electronic payments on their behalf for a fee. That fee is an increased cost of doing business, which is passed on to customers.

With a yearly revenue in the double digits billions, I think cost of running a payment center is what we'd refer to as pocket change.

 

[s0me0nesmind1]

With a yearly revenue in the double digits billions, I think cost of running a payment center is what we'd refer to as pocket change.

Well - ultimately, it boils down to this:

Either someone has to process the payment - typically a worker that is paid a yearly salary.... or a system processes it.

Either way, any "system" cost should be negated by the lack of requiring it to be processed by a human. Hence, prices should already have that factored into them.

 

[Jeff7]

Well - ultimately, it boils down to this:

Either someone has to process the payment - typically a worker that is paid a yearly salary.... or a system processes it.

Either way, any "system" cost should be negated by the lack of requiring it to be processed by a human. Hence, prices should already have that factored into them.

Itemizing out a fee like that, which could also be called a "We have to offset the burdensome cost of being able to take your money" fee, makes it feel like a petty thing to do, especially if letting a computer do it is cheaper than paying a CSR to take your call, or someone opening mail to process a check or money order.